EXHIBIT 10.2
AGREEMENT
THIS AGREEMENT to sell certain improved land and personal
property located in Riverton, Wyoming ("Agreement") made and
entered into as of April 26, 1996 by and between U.S. Energy Corp.
a Wyoming Corporation ("USE"), and USECC Joint Venture, a Wyoming
co-partnership ("USECC") consisting of USE and Crested Corp., a
Colorado Corporation ("Crested") (USE and USECC hereinafter being
referred to collectively as "Sellers"), and Arrowstar Investments
Inc., a Wyoming corporation ("Arrowstar"), as buyer.
WITNESSETH:
WHEREAS, Sellers are engaged in the acquisition, mining,
development and/or marketing of uranium concentrates; and
WHEREAS, Sellers are disposing of assets not directly related
to the production of uranium concentrates to generate cash to meet
obligations incurred in the uranium business and for general
administrative expenses.
NOW THEREFORE for $10.00 and other consideration and the
promises made by the parties one to the other, the Parties agree as
follows:
1. Premises: Sellers jointly agree to sell, and Arrowstar agrees
to purchase, all of that improved land and personal property in the
City of Riverton, Fremont County, Wyoming, more specifically
described on Exhibit A attached to and hereby incorporated by
reference in this Agreement (the "Premises"), known generally as
the Wind River Estates Mobile Home Park and described in the
Appraisal Report (the "Appraisal") prepared for the First
Interstate Bank of Commerce, Gillette, Wyoming (the "Lender"), by
Mike McDonald of McDonald Appraisal Service Inc. of Riverton,
Wyoming. The Premises are sold "AS IS" in the condition existing
on the date of this Agreement and include all fixtures and
improvements to the land (more specifically described in the
Appraisal) and those mobile and modular homes listed on Exhibit A
and all storage sheds, equipment and other personal property
(including all security deposits made by tenants) owned by Sellers
(or either of them) and located on the Premises on the date of this
Agreement (the "Personal Property"), but excluding any and all
mobile and modular homes, trailers, motor vehicles and other
personal property located on the Premises, owned by others (whether
temporarily affixed to the land or not). The sale is subject to
the option in Sellers (or either of them) to repurchase the
Premises in accordance with the terms of paragraph 17 of this
Agreement, which shall survive the closing of the transfer of title
to the Premises (the "Closing") and the delivery of the deeds and
bill of sale pursuant to paragraph 3.
USE/Arrowstar
April 26, 1996
Page 2
2. Purchase Price: The purchase price for the Premises is the
sum of $804,000, which is its "AS IS" Market Value as of April 5,
1996 determined by the Appraisal. Of this amount, the Parties
agree that $52,000.00 shall be allocated as the purchase price for
the personal property. The purchase price shall be paid by
Arrowstar at Closing in the following manner:
a) $500,000 shall be paid by Lender's bank draft from the
proceeds of a loan from Lender to Arrowstar;
b) $47,934.25 shall be paid by Arrowstar canceling the
balance of that certain promissory note dated September 1,
1995, in the original principal amount of $45,000 given by
USECC to Arrowstar as part of the purchase price for other
real property in the City of Riverton more specifically
described in that certain Option Agreement dated June 14,
1995, as amended November 1, 1995
c) $161,378.34 shall be paid by Arrowstar assigning to USECC
its entire interest in First-N-Last L. L. C., a Utah Limited
Liability Company ("L. L. C."), with the written consent and
waiver of preemptive rights by Canyon Homesteads, Inc.
("CHI"), which USE agrees to deliver or cause CHI to deliver
at Closing. Additionally, USECC will credit Arrowstar
$38,687.41 for goodwill due to Arrowstar's investing in First-
N-Last.
d) The balance of $56,000.00 shall be paid by an Installment
Promissory Note of Arrowstar to Sellers substantially in the
form of Exhibit B attached hereto.
3. Transfer of Title: At Closing Sellers shall convey to
Arrowstar good and marketable title to the Premises by Warranty
Deed from USE in the form attached as Exhibit C-1, and Quitclaim
deed in the form attached as Exhibit C-2 from USECC, and a Bill of
Sale in the form attached as Exhibit C-3 from USE and USECC, which
shall be signed by duly authorized officers of USE and Crested and
shall be attested and/or notarized in form suitable for recording
in Fremont County, Wyoming and accompanied by copies of resolutions
adopted by the board of directors of each of USE and Crested, duly
certified by their respective Secretaries or Assistant Secretaries.
Arrowstar agrees to accept the Premises subject only to: (i)
applicable zoning ordinances of the City of Riverton, WY; (ii) any
state of facts an accurate survey might show; (iii) those existing
leases and occupancy rights, and hereby incorporated herein by this
reference; (iv) any right, title, or interest in any mineral
rights, or related matters, including but not limited to oil, gas,
USE/Arrowstar
April 26, 1996
Page 3
coal, and other hydrocarbons; (v) easements as delineated on
recorded plat; (vi) general taxes not now payable and matters
relating to special levies or assessments if any, preceding the
same becoming a lien; (vii) any service, installation or connection
charge for sewer, water or electricity; and (viii) such other
defects and encumbrances to title that Lender may accept at Closing
with respect to its loan to Arrowstar, provided the same do not
render title unmarketable. In the event that Sellers are unable to
convey such good and marketable title to the Premises to Arrowstar
at the Closing in accordance with the terms of this Agreement, for
reasons other than Sellers' willful default, then either party may
elect, by written notice to the other party, to postpone the
Closing to another date and time, but not later than 4 P.M. on May
16, 1996, during which time, Sellers shall use their best efforts
to remedy the cause of their inability to convey good and
marketable title. If neither party elects to postpone the Closing
as hereinabove provided or if, upon such other date set for
Closing, Sellers are unable to convey good and marketable title to
the Premises to Arrowstar in accordance with the terms of this
Agreement, then Arrowstar shall have the option of taking such
title as the Sellers can give, without abatement of the purchase
price, or terminate this Agreement and be repaid all moneys (if
any) paid on account of the purchase price, together with the
actual expenses of title examination. In the event Arrowstar
elects to terminate this Agreement as aforesaid, upon Sellers'
payment of the aforesaid monies (if any), this Agreement shall
terminate and there shall be no further liability or obligation by
either of the parties hereunder. Title to the Personal Property
shall be transferred to Arrowstar by a general Bill of Sale which
USE and USECC shall execute and deliver at Closing, together with
such documents of title to mobile and modular homes and other
specific items of Personal Property as may be requested by
Arrowstar subsequent to the Closing, which USE and USECC covenant
to execute and deliver to Arrowstar promptly upon request.
4. Possession: Possession of the Premises shall be given to
Arrowstar at Closing, subject to those mobile and modular home
leases and other occupancy rights existing on the date of this
Agreement.
5. Closing: The closing of title transfer to the Premises and
payment of the purchase price for the Premises shall take place at
the offices of Riverton Title Services, 113 N. 5th East, Riverton,
Wyoming, at 10 o'clock in the morning on Friday April 26, 1996 or
at such other time, place and/or date as the Sellers and Arrowstar
may mutually agree.
6. Conditions to Closing: Closing of the transactions
contemplated in this Agreement shall be simultaneous and each is
conditioned on satisfaction of the following conditions:
USE/Arrowstar
April 26, 1996
Page 4
a) Sellers' representations set forth in this Agreement
shall be true and accurate as of the date of this Agreement
and as of the time of Closing.
b) Arrowstar's representations set forth in this Agreement
shall be true and accurate as of the date of this Agreement
and as of the time of Closing.
c) Lender shall disburse the proceeds of the loan of
$500,000 to Arrowstar in accordance with separate lending
agreements between Arrowstar and Lender.
d) The Promissory Note given by USECC to Arrowstar (referred
to in paragraph 2 (b) of this Agreement) shall be marked paid
by Arrowstar and delivered to USECC at Closing.
e) Arrowstar shall deliver a good and sufficient instrument
of Assignment to USECC to transfer Arrowstar's entire interest
in L. L. C. to USECC.
f) There shall be no defaults pending at the time of Closing
under the L. L. C. Operating Agreement and L. L. C. shall be
in good standing and qualified to do business in the State of
Utah.
g) Sellers shall convey to Arrowstar good and marketable
title to the real property included in the Premises by a
Warranty Deed and Quit Claim Deed, deliver to Arrowstar a
general Bill of Sale transferring all of Sellers' right, title
and interest in and to the Personal Property to Arrowstar in
accordance with the terms of Paragraph 3 above of this
Agreement.
h) Arrowstar shall deliver its Installment Promissory Note
referred to in subparagraph 2 (d) of this Agreement to USECC,
duly executed by appropriate corporate officers of Arrowstar
and accompanied by a resolution of the board of directors of
Arrowstar, certified by its Secretary or Assistant Secretary
establishing the authority for Arrowstar's delivery of such
Promissory Note.
7. Apportionment of Taxes, etc. All real estate taxes shall be
apportioned as of the date of Closing on the basis of the total
taxes paid or required to be paid with respect to the Premises for
the calendar year 1996. Rents shall be apportioned as of May 1,
1996 with Sellers retaining all rents paid or due for the month of
April irrespective of the portion of the month remaining after the
Closing. Sellers shall deliver to Arrowstar at Closing a list of
rents paid and unpaid as of the day of immediately preceding the
Closing date.
USE/Arrowstar
April 26, 1996
Page 5
8. Additional Lands Included and Condemnation: The sale and the
purchase price include all right, title and interest, if any, of
the Sellers in and to any strips and gores adjoining any of the
Premises, any land lying in the bed of any street, road or avenue,
opened or proposed, in front of or adjoining the Premises and all
right, title and interest of the Sellers in and to any award made
or to be made in connection with the condemnation or the taking
thereof and in and to any unpaid award for damage to the Premises
by reason of change of grade or width or location or relocation of
any street or road, permanent interference with access to the
Premises, and/or any other compensable occurrence. Sellers agree
to execute and deliver to Arrowstar at Closing, or thereafter on
demand, all proper instruments for the conveyance of such title and
the assignment and collection of any such award.
9. Broker Fees: Each party represents to the other that it has
not dealt with any broker in connection with this sale and each
agrees to indemnify the other from any claims for commission which
may be made by any broker through whom such party has had any
dealing in connection with this transaction.
10. Notices or Ordinances: Sellers have not received any notice
from any governmental body or other public authority having
jurisdiction over the Premises, and have no knowledge of (i) any
assessment or charge against the Premises which remains unpaid on
the date hereof other than real estate taxes referred to in
Paragraph 7 of this Agreement or (ii) any work or improvements
which have been started or are proposed by any governmental body or
public authority for which an assessment or charge could be made
against the Premises. All notices from any governmental body or
other public authority against or affecting the Premises at the
date hereof shall be complied with by Sellers and the Premises
shall be conveyed free of the same, and this provision of this
Agreement shall survive delivery of the deed hereunder. If, at the
time of Closing, the Premises or any part thereof shall be or shall
have been affected by an assessment or assessments which are or may
become payable in installments, then for the purposes of this
Agreement all the unpaid installments of any such assessment that
become due and payable after the delivery of the deed, shall be
deemed to be the responsibility of Arrowstar and shall be paid and
discharged by Arrowstar as they become due and payable.
11. Entire Agreement of Parties and Amendments: This Agreement
constitutes the entire Agreement between the parties, and no
amendment to the terms of this Agreement shall be binding unless
reduced to writing, and signed by all the parties hereto.
USE/Arrowstar
April 26, 1996
Page 6
12. Binding Effect: This Agreement shall inure to and be binding
upon the Parties hereto, their successors and permitted assigns.
13. Assignment: For a period of two years from the date of this
Agreement, Arrowstar shall not assign its interest in this
Agreement without the prior written consent of both Sellers,
provided however Arrowstar may sell any and all items of personal
property included in this Agreement.
14. Sellers' Representations: Sellers represent and warrant to
Arrowstar that (i) Sellers are duly organized and validly existing
under and by virtue of the laws of the States of Wyoming and
Colorado as shown above; (ii) Sellers have full power, authority
and right to enter into this Agreement and to convey the Premises
free and clear of any option, lien, commitment, restriction or
other encumbrance except taxes and occupancy leases and rights
identified in Paragraph 7; (iii) To Sellers' knowledge, there is no
pending or threatened condemnation of any part of the Premises; and
(iv) to Seller's knowledge there are no material environmental
hazards on or affecting the Premises.
15. Arrowstar's Representations: Arrowstar represents and
warrants to Sellers that (i) Arrowstar is duly organized and
validly existing under any by virtue of the law of the State of
Wyoming; (ii) Arrowstar has full power, authority and right to
enter into this Agreement and to perform its obligations under this
Agreement in the manner contemplated herein; (iii) L. L. C. is duly
organized and in good standing as a limited liability company in
the State of Utah and is qualified to do business in the State of
Utah; (iv) no default exists under the L. L. C. Operating Agreement
on the date hereof and Arrowstar has full power, authority and
right to assign and transfer its entire interest in L. L. C. upon
delivery of CHI's written consent and waiver of preemptive rights
under the Operating Agreement for L. L. C..
16. Notice: Any notice to be given pursuant to this Agreement
shall be sufficient if in writing and mailed by registered or
certified mail, postage prepaid, or delivered in person or by
express delivery service to the following addresses:
(i) If to Sellers: U.S. Energy Corp. and USECC
877 North 8th West
Riverton, WY 82501
(ii) If to Arrowstar: Arrowstar Investment Inc.
877 North 8th West
Riverton, WY 82501
Either party may by notice given as aforesaid change the
address for notices to it.
USE/Arrowstar
April 26, 1996
Page 7
17. Sellers' Option: Sellers (and each of them) shall have an
option to repurchase the real property included in the Premises and
the remaining Personal Property for a cash purchase price equal to
the fair market value of the Premises as of the date that is within
sixty days prior to or after the date Sellers exercise of their
option under this paragraph 17. Fair market value shall be
determined by appraisal conducted by any independent appraiser
licensed in Wyoming selected by Sellers (or either of them) and
reasonably acceptable to Arrowstar. Sellers (or either of them)
may exercise this option by giving written notice to Arrowstar at
any time prior to the 2nd anniversary of the Closing. Upon receipt
of such notice, Sellers and Arrowstar shall mutually determine a
time and place for closing such repurchase, which shall take place
not more than 60 days following Sellers giving such notice of
exercise. The provisions of this paragraph 17 shall survive the
Closing and delivery of the Deeds and Bill of Sale to Arrowstar
pursuant to paragraph 3.
IN WITNESS WHEREOF, the parties hereto have set their hands
and seals the day and year first above written.
ATTEST: U.S. ENERGY CORP.
s/ Max T. Evans By s/ Harold F. Herron
- ------------------------------ -------------------------
Secretary
USECC JOINT VENTURE
By U.S. ENERGY CORP.
s/ Max T. Evans By s/ Harold F. Herron
- ------------------------------ -------------------------
Secretary
ATTEST: By CRESTED CORP.
s/ Daniel P. Svilar By s/ Max T. Evans
- ------------------------------ -------------------------
Secretary
ATTEST: ARROWSTAR INVESTMENTS, INC.
s/ Keith G. Larsen By s/ Mark J. Larsen
- ------------------------------ -------------------------
Secretary